FILE – A Big Lots store in Carle Place, New York, on July 23. (Howard Schnapp/Newsday RM via Getty Images / Getty Images)
Big Lots is reportedly weighing the possibility of filing for bankruptcy due to declining sales.
The discount retailer is considering filing for bankruptcy as a potential option, Bloomberg reported late Wednesday, citing people with knowledge of the plans.
A source familiar with the situation told the outlet that Big Lots is trying to dodge Chapter 11 by hunting for investors.
BIG LOTS COULD POTENTIALLY CLOSE 315 STORES
Bloomberg’s report came about two-and-a-half months after the discount retailer flagged “substantial doubt about the Company’s ability to continue” in a mid-June Securities and Exchange Commission filing amid an inflation-related pullback in its shoppers’ spending.
Big Lots said in the same filing that it “has incurred net losses and used cash in operating activities in 2022, 2023, and the first quarter of 2024.”
In the first quarter, the discount retailer said its net sales for the three-month period declined 10.2% year-over-year to $1 billion. For all of 2023, net sales were $4.72 billion, a 13.6% decrease compared with the prior year.
BIG LOTS COULD POTENTIALLY CLOSE 315 STORES
More recently, in an Aug. 2 filing, the company told investors that it had upped the number of permitted store closings to a maximum of 315 as part of late July amendments to a credit agreement and term loan facility. That marked a 165-store increase from the 150 previously permitted.
There were nearly 1,400 Big Lots stores in the U.S. as of the first quarter. The discount retailer’s locations sell home goods, furniture, seasonal decorations and other products.
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Big Lots did not respond to FOX Business’ requests for comment.
FOX Business’ Pilar Arias contributed to this report.
